The American Express Plum Card Review for Small Business
The Plum card also comes with several unique features that make it a perfect fit for entrepreneurs who need to cover temporary cash flow issues. However, the card does come with a hefty yearly fee so it won’t be the right choice for everyone.
About the American Express Plum Card
The American Express Plum Card is a business charge card that’s designed for small and medium-sized businesses that need a way to manage cash flow. It does this by offering two helpful features.
First, you’ll receive a 1.5% discount if you pay your balance within 10 days of the statement closing date. You can think of this as being similar to cashback rewards; only instead of collecting points, you earn a discount.
The second way the Plum card helps with cash flow is by giving you 60 days to pay your balance without being charged interest. You just need to pay at least 10% of your current statement balance, and any previous balances you deferred payment on.
However, there are a few things to keep in mind about the American Express Plum card. First, the card comes with a $250 annual fee, which is higher than what most cards charge.
In addition, it’s important to note that this isn’t a rewards card. You won’t earn points, cashback, or travel bonuses for using the Plum card. Instead, the card gives you flexible access to cash and offers a discount for paying off your balance early. As previously mentioned, it’s designed to help businesses manage their cash flow.
Benefits and Rewards with American Express Plum
If you’re in the market for a charge card option, there are many benefits to using the Plum card. Listed below are the benefits and rewards this card offers:
- The card provides a 1.5% discount for paying your balance within 10 days of the statement closing date. Plus, there’s no cap on how much you can save.
- You can take up to 60 days to pay your bill without collecting interest on your balance.
- American Express waives the $250 fee for the first year.
- There are no foreign transaction fees.
Pros and Cons
There are advantages and disadvantages to every card, and the American Express Plum card is no exception. Here is an overview of the pros and cons of using the card.
Pros of the American Express Plum Credit Card
- The card makes it easier to manage cash flow: Unlike credit cards, charge cards don’t come with pre-set spending limits. This doesn’t mean you can spend as much as you want, but it’s more flexible than a traditional credit card.
- Flexible payment options: Every month, you must pay at least 10% of your current statement balance, as well as any balances you previously deferred. After that, you can defer the remainder of your balance to the next month without being charged interest.
In total, American Express gives you up to 60 days to pay your balance without being charged interest.
- Earn a discount for paying early: Instead of providing cashback points, the Plum card gives customers a discount for paying their balance within 10 days of the closing statement. And there’s no cap to the amount you can earn in early payment discounts.
- No foreign transaction fees: The Plum card doesn’t charge any foreign transaction fees, so it’s a good choice for international travelers.
Cons of the American Express Plum Credit Card
- There is an annual fee: The fee is waived for the first year, but after that, American Express charged a $250 annual fee. If you can earn substantial early-payment discounts, the fee may be worth it. Otherwise, it might be worthwhile to consider another card.
- You can’t carry a balance: The American Express Plum Card is a charge card, not a credit card, so you can’t carry an ongoing balance. And if your payment is late, you’ll be charged a late fee of $39 or 1.5% of the past due amount, depending on which is higher.
- You can’t earn cashback rewards: And finally, the Plum card doesn’t offer cashback rewards. So if this is something you’re looking for, you’ll want to go with another credit card.
Alternative Small Business Credit Cards
If you’re looking for alternatives to the Plum card, here are a few excellent choices you can consider:
- American Express Business Gold Card: This card is great for small business owners who are looking to earn travel rewards.
- Capital One Spark Cash for Business Card: This card offers a generous signup bonus and 2% cashback rewards.
- Ink Business Preferred Credit Card: This is a great card for business owners who travel frequently. The card comes with travel cancellation insurance, primary rental car coverage, and cell phone protection.
The American Express Plum card offers many attractive features for businesses looking to manage unpredictable cash flow. Because it’s a charge card, you won’t earn cashback rewards. But if you pay your bill early, you’ll receive a 1.5% discount, which could help offset the annual $250 fee.
If you’re not sold on the Plum card, there are several good alternatives you can check out, including other American Express business cards. Do your research and make sure you understand the terms and conditions before applying for any charge card or credit card.
Frequently Asked Questions
How does the American Express Plum card work?
It’s a charge card that helps small to medium-sized businesses manage cash flow. Instead of offering cashback rewards, American Express offers a 1.5% discount to customers that pay their balance within 10 days of the closing statement.
What are the benefits of using the card?
The card makes it easy for businesses to manage cash flow and offers flexible payment options. It also offers an early payment discount, and there’s no limit to the amount you can earn.
What are the drawbacks?
The card comes with a $250 annual fee. And unlike a standard credit card, you can’t carry a balance on the card.
Are there any alternatives?
Yes, the American Express Business Gold Card, Capital One Spark Cash for Business Card, and Ink Business Preferred Credit Card are all good alternatives.
Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author's alone, and have not been reviewed, approved, or otherwise endorsed by any of these entities.